Honorable Robert Bunda

President of the Senate

Twenty-Second State Legislature

Regular Session of 2003

State of Hawaii

Sir:

Your Committee on Energy and Environment, to which was referred H.B. No. 1492, H.D. 2, entitled:

begs leave to report as follows:

The purpose of this measure is to expand the State's net metering program by removing all restrictions on allowable net-metered system size, and incrementally increasing the allowable percentage of net-metered generation to five per cent by 2020.

Sierra Club Hawaii Chapter, Hawaii Renewable Energy Alliance, PowerLight, and an individual submitted testimony supporting this measure. The Department of Business, Economic Development, and Tourism and the Consumer Advocate submitted testimony supporting the intent of this measure. Hawaiian Electric Company, Inc. submitted comments on this measure.

Your Committee finds that this measure is the fastest way to open the distributed generation market to all segments of our society. Additionally, the proposed staged growth of the market share is predictable and a stabilizing force for market development. Suppliers will be willing to develop this market based on the percentage of utility capacity as a guide to market potential.

Your Committee has amended this measure by changing the effective date to July 1, 3050, for the purpose of furthering discussion on this measure in conference committee.

As affirmed by the record of votes of the members of your Committee on Energy and Environment that is attached to this report, your Committee is in accord with the intent and purpose of H.B. No. 1492, H.D. 2, as amended herein, and recommends that it pass Second Reading in the form attached hereto as H.B. No. 1492, H.D. 2, S.D. 1, and be referred to the Committee on Commerce, Consumer Protection and Housing.